Goldman Sachs Turns to Forecast of October Fed Rate Hike; Bitcoin Holds Near $76,000
Summary
- Goldman Sachs reversed its earlier forecast that the US Federal Reserve would pause after a September rate increase and now expects the benchmark rate to rise by an additional 0.25 percentage point in October.
- The revision appears to have been influenced by the Fed's hawkish signal and markets pricing in more than a 50% chance of another October increase.
- Meanwhile, Bitcoin was little changed near the $76,000 level and was up about 0.5% from 24 hours earlier.
Forecast Trend Report by Period
Goldman Sachs has reversed its earlier forecast that the Federal Reserve would pause after a September rate increase and now expects another hike in October.
CoinDesk reported on September 17 that Goldman Sachs projects the Fed will raise its benchmark interest rate by an additional 0.25 percentage point in October. The bank had previously expected the Fed to hold rates steady after a September increase.
The Fed lifted its benchmark rate by 0.25 percentage point to 3.75% to 4.00% at the Federal Open Market Committee meeting the previous day. It marked the first rate increase since 2023.
The revised forecast appears to reflect the Fed's hawkish signal. In the rate projections released by the central bank, a majority of policymakers expected at least one additional increase this year.
Fed Chair Kevin Warsh said at a press conference that inflation remains "too high." He described the latest rate increase as removing "some of the degree of accommodation" in policy, signaling the possibility of further tightening.
Markets are also increasingly pricing in another October move. CME FedWatch showed traders assigning a more than 50% chance of an additional 0.25 percentage-point increase in October.
Bitcoin, meanwhile, was little changed and held near $76,000. As of publication, it was trading at $76,260, up about 0.5% from 24 hours earlier.
Suehyeon Lee
shlee@bloomingbit.ioI'm reporter Suehyeon Lee, your Web3 Moderator.